The court reiterates the importance of statutory limitations in enforcing demands and validates the discharge of mortgage obligations.

ORDER

The petitioner seeks to quash the proceedings of the second respondent in No. 7069/A3/2024 dated 26.11.2024.

2. The petitioner is the owner of several extents of land situated in Radhapuram and Tenkasi Taluks. For the loans availed by one M/s Orient Green Power Company Limited, the holding company of the writ petitioner, the petitioner executed a deed of mortgage on 23.10.2018 in favour of M/s Yes Bank Ltd. The mortgage was executed as security for a loan of Rs.50 crores.

3. It is the plea of the petitioner that it was a mortgage without possession. Hence, a sum of Rs.40,000/- was paid towards stamp duty and Rs. 10,000/- towards the registration fee. The petitioner pleads that the mortgage debt was duly discharged and the mortgage has also been released. On 06.11.2023, the fourth respondent called upon the petitioner to pay a sum of Rs. 1,99,59,900/- towards deficit stamp duty and a further sum of Rs.1,90,000/- towards deficit registration charges. It is not in dispute that the demand was with respect to the mortgage deed dated 23.10.2018.

4. The petitioner pleads that the entire dues were discharged, and no due certificate was also issued as on 25.08.2023. The petitioner sent a reply to the notice received from the fourth respondent on 18.12.2023, stating that the deficit stamp duty would not apply as the present document is not one under Article 40(a) of the Indian Stamp Act, 1899 (herein after referred to as “Act”). According to the petitioner, it falls under Article 40(b) of the said Act. Furthermore, a plea was taken that the entire proceedings is barred by virtue of Section 33A of the Act. Despite the same, as the impugned order came to be passed on 26.11.2024, the petitioner is before this Court by way of this writ petition.

5. When the matter was taken up for admission, Mr.R.Sureshkumar, learned Additional Government Pleader, took notice for the respondents. He sought time to file a counter. Time was granted. He has also filed a counter.

6. According to Mr.R.Sureshkumar, in terms of clause 10(a)(ix) of the mortgage deed, the mortgage deed is one by which the possession of the property had been agreed to be handed over, upon directions issued by the mortgagee, and therefore, it falls under Article 40(a) of the Act. He further pleads that the demand is not barred by time, as the audit objections were received, and subsequently, the respondents became aware that there is a deficit. Hence, made the demand immediately. He also points out that the remedy for the petitioner is to approach the first respondent, who is the appellate authority, as per circular No.34675/T2/2018 dated 31.07.2018 and therefore, this writ petition is not maintainable.

7. I have considered the submissions of both sides.

8. The clause that is relied upon by Mr.Raguvaran Gopalan is Clause 17 of the mortgage deed. It states as follows:

“Without prejudice to the generality of Clause 19 (Coats and Expenses), the Mortgagor does hereby expressly agree with the Mortgagee that neither the Lender(s) nor any receiver appointed as aforesaid shall, by reason of the Mortgagee or such receiver entering into or taking possession of the Mortgaged Properties or any part thereof, be liable to the Mortgagor to account as a mortgage-in-possession for anything except actual receipts or be liable for any loss or for any default or omission for which a mortgage-in-possession might be liable.”

9. A reading of the clause shows that the mortgagor and mortgagee had agreed that by virtue of the mortgage, neither the mortgagee nor any recei